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The rationale behind the harsher than normal sentencing meted out to the recent rioters was essentially a 'moral hazard' argument.

The notion being that if such acts are not seen to evoke a strong response there is a danger they will grow more frequent and worse.

Yet when we examine the white collar looting of the public perpetrated by the Financial sector this principle seems to have gone into reverse. Far from being brought to book for their behaviour the official response seems to have been to close ranks with the perpetrators and send them on their way with bonus's and pensions intact- no attempt to address the moral hazard issue this raises.

We see lives being destroyed as pensions, jobs and business's are lost and yet no serious attempt is made to find out why and who is responsible.

So the message could not be clearer- If you wear a suit to work, if you deal in other people's money and work for a large institution you are free to engage in any kind of destructive behaviour you wish, any degree of corruption and control fraud so long as you are not caught doing it, or do it in such a way as to pervert the rules rather than overtly break them.

So if we follow the logic of harsh sentences given to the looters on the streets the only conclusion is that the lack of consequences for the looters in the City is that they will continue to loot and that this looting will escalate.

So the only question now remaining is at what point the City loses the trust it requires to function? How long before the now hollowed out shell of what was once a place of trust and confidence collapses in on itself.

Banking without trust is an oxymoron.

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Politicians are very unlikely to get £2m a year consultancies from skint people stealing from shops.

Tony blair will earn around £2 million a year in his part-time role as adviser to the Wall Street bank JP Morgan without ever having to go into the office.

http://www.telegraph.co.uk/news/politics/labour/1575247/Tony-Blair-to-earn-2m-as-JP-Morgan-adviser.html

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So the only question now remaining is at what point the City loses the trust it requires to function? How long before the now hollowed out shell of what was once a place of trust and confidence collapses in on itself.

Banking without trust is an oxymoron.

I don't think it is , the banks do not need trust when they have a captive clientel that included's most of the adults in the nation . Try running your life without a bank account almost immpossible now , even those who have gone bankrupt have access to a basic bank account and that is one of the first things they get in place when first made bankrupt . Wages , benefits , pensions , refunds are all paid straight into bank accounts and some companies offer disscounts for payment's when coming from bank accounts via DD.

Talk to old people and they will tell you misstrust of the banks has always been the case , we have had the NR crisis , Mortgage Express, H.B.O.S., Lemans and a few smaller ones like Derybeshire Building Society all collapse in the last few years , that is without the billions pumped into others and still the customers stay with the banks WHY ? Because they have no choice.

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Politicians are very unlikely to get £2m a year consultancies from skint people stealing from shops.

Exactly. Vince Cable called them Spivs, only for his party to today have an £800 a head "business only" day at the Liberal Democrat conference.

(Source - Channel 4 news)

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The rationale behind the harsher than normal sentencing meted out to the recent rioters was essentially a 'moral hazard' argument.

Banking without trust is an oxymoron.

Breaking News 19th Sept 2011 >>>

http://blogs.telegraph.co.uk/news/jamesdelingpole/100105725/rogue-trader-in-38-6-billion-green-jobs-fraud/

Rogue trader in $38.6 billion 'green jobs' fraud

A rogue trader at one of the world's largest banks (USA Inc., second in economic power only to China Inc.) has been exposed as the biggest fraudster in the history of mankind. The fraud – conservatively estimated at $38.6 billion, though others believe it could be at least 20 times bigger once his secret trading accounts in a file mysteriously marked "Stimulus Package" are fully investigatedcomfortably exceeds the paltry $2.3 billion losses run up by UBS trader Kweku Adoboli.

Though full details of the Uber Rogue Trader – known only by his initials B.O. – have yet to be released, he is believed to be either of Hawaiian or Kenyan birth, with a plausible speaking manner and a deceptive aura of competence and gravitas. He is said to be "coolly unrepentant" about his crime, which, he claims, he was only doing to provide "hope and change" to his 200 million victims.

The fraud appears to have centred around an arcane taxpayer-swindling system first devised by Kenneth Lay of Enron known as "Clean tech" or "green jobs." B.O. – who joined the bank in January 2009 – is believed to have persuaded colleagues and shareholders that he could boost the institution's flagging profits by spending $38.6 billion on a "loan guarantee program" for clean tech start up companies. He also claimed that in the process he would create "65,000 jobs".

Correctly anticipating that in the open market no one would actually want to buy such overpriced, economically inefficient energy as solar or wind, B.O. hit on the ingenious scam of ramping up demand by spreading misleading rumours. He persuaded high-placed friends at institutions including NASA, the EPA and the IPCC to promote junk-science data grotesquely exaggerating the dangers of carbon based energy and the benefits of "renewable" energy. BO then poured sums of up to half a billion dollars into Ponzi schemes – aka Green Tech – run by sympathetic friends.

Unfortunately, the scam was exposed when one of B.O's Green Tech Ponzi schemes – a solar energy company called Solyndra – collapsed with losses which could cost USA shareholders as much as $527 million. Two other solar companies in B.O's Green Tech Ponzi scheme have also folded: Evergreen Solar, Inc and SpectraWatt.

-----------------------------------------------------------------------------------------------------------------------------------------------------------------------

http://www.washingtonpost.com/politics/white-house-pushed-500-million-loan-to-solar-company-now-under-investigation/2011/09/13/gIQAr3WbQK_print.html

Solyndra loan: White House pressed on review of solar company now under investigation

By Joe Stephens and Carol D. Leonnig,

Solyndra < > SOY-LENT

EXCLUSIVE | The Obama White House tried to rush federal reviewers for a decision on a nearly half-billion-dollar loan to the solar-panel manufacturer Solyndra so Vice President Biden could announce the approval at a September 2009 groundbreaking for the company’s factory, newly obtained e-mails show.

The Silicon Valley company, a centerpiece in President Obama’s initiative to develop clean energy technologies, had been tentatively approved for the loan by the Energy Department but was awaiting a final financial review by the Office of Management and Budget.

The August 2009 e-mails, released exclusively to The Washington Post, show White House officials repeatedly asking OMB reviewers when they would be able to decide on the federal loan and noting a looming press event at which they planned to announce the deal. In response, OMB officials expressed concern that they were being rushed to approve the company’s project without adequate time to assess the risk to taxpayers, according to information provided by Republican congressional investigators.

Solyndra collapsed two weeks ago, leaving taxpayers liable for the $535 million loan.

One e-mail from an OMB official referred to “the time pressure we are under to sign-off on Solyndra.” Another complained, “There isn’t time to negotiate.”

“We have ended up with a situation of having to do rushed approvals on a couple of occasions (and we are worried about Solyndra at the end of the week),” one official wrote. That Aug. 31, 2009, message, written by a senior OMB staffer and sent to Terrell P. McSweeny, Biden’s domestic policy adviser, concluded, “We would prefer to have sufficient time to do our due diligence reviews.”

White House officials said Tuesday that no one in the administration tried to influence the OMB decision on the loan. They stressed that the e-mails show only that the administration had a “quite active interest” in the timing of OMB’s decision.

“There was interest in when a decision would be made because of its impact on whether an event involving the vice president could be scheduled for a particular date or not, but the loan guarantee decision was merit-based and made by career staffers at DOE,” White House spokesman Eric Schultz said.

Solyndra spokesman David Miller said he was unaware of any direct involvement of the White House in securing or accelerating the loan.

The e-mail exchanges could intensify questions about whether the administration was playing favorites and made costly errors while choosing the first recipient of a loan guarantee under its stimulus program. Solyndra’s biggest investors were funds operated on behalf of the family foundation of Tulsa billionaire and Obama fundraiser George Kaiser. Although he has been a frequent White House visitor, Kaiser has said he did not use political influence to win approval of the loan.

The White House has previously said that it had no involvement in the Solyndra loan application and that all decisions were made by career officials based on the merits of the company.

It is not clear from the e-mails whether the White House<br align="block">influenced a final decision to approve the loan guarantee.

The Sept. 4, 2009, groundbreaking event went ahead as scheduled, with Energy Secretary Steven Chu in attendance and Biden speaking to the gathering by satellite feed.

Republican investigators for the House Energy and Commerce Committee, which is holding a hearing about Solyndra on Wednesday, concluded that the White House set a closing date for the OMB approval even before the OMB review had begun.

The White House pressure may have had a “tangible impact” on the OMB’s risk assessment of the loan, the congressional investigators concluded.

In one e-mail, an OMB staff member questioned whether the review team was using the best model for determining the financial risk to taxpayers in evaluating the Solyndra deal.

“Given the time pressure we are under to sign-off on Solyndra, we don’t have time to change the model,” the staffer wrote.

Solyndra was a favorite of the administration until two weeks ago, when the company abruptly shuttered its factory and filed for bankruptcy court protection, leaving 1,100 people out of work and taxpayers on the hook for the loans. Last week, FBI agents searched the company’s Silicon Valley headquarters in a raid that Miller said appeared linked to the loan guarantee.

In one e-mail, an assistant to Rahm Emanuel, then White House chief of staff, wrote on Aug. 31, 2009, to OMB about the upcoming Biden announcement on Solyndra and asked whether “there is anything we can help speed along on OMB side.”

An OMB staff member responded: “I would prefer that this announcement be postponed. . . . This is the first loan guarantee and we should have full review with all hands on deck to make sure we get it right.”

In another message, a White House staff member wrote that officials were “walking a fine line with Solyndra needing to begin notifying investors to fly in” for the groundbreaking. It stressed that “this OMB piece” of the review was not final and pointed out that if word of the groundbreaking leaked to the public prematurely, that would “leave us in an awkward place.”

The e-mails also raise questions about whether the administration should have foreseen financial trouble. In August 2009, e-mail exchanges between Energy Department staff members pointed out that a credit-rating agency predicted that the project would run out of cash in September 2011. Solyndra shut its doors on the final day of August.

The House committee has been investigating Solyndra’s dealings with the Energy Department for six months. In July , subcommittee members subpoenaed White House documents related to the guarantee.

Questions about the selection process were first raised in a July 2010 audit by the Government Accountability Office. It concluded that the Energy Department “lacked appropriate tools for assessing the progress” of the loan program and that the department treated applicants inconsistently, “favoring some applicants and disadvantaging others.”

House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) and Rep. Cliff Stearns (R-Fla.), chairman of that panel’s oversight and investigations subcommittee, said last week that the FBI raid confirmed their belief that the “darling” of Obama’s green-jobs program was a “bad bet” from the beginning.

“Solyndra was the hallmark of the President’s green jobs program and widely promoted by the administration as a stimulus success story, right up until its bankruptcy and FBI raid,” Upton and Stearns said in a statement on Tuesday. “Let’s learn the lessons of Solyndra before another dollar goes out the door.”

Rep. Henry A. Waxman (Calif.) and Rep. Diana DeGette (Colo.) — Democrats on the committee who had once defended the choice of Solyndra — last week also questioned whether they had been misled. In a letter, they wrote

that Solyndra chief executive Brian Harrison “did not convey to us the perilous condition of the company, and the Committee should know why. ”

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Politicians are very unlikely to get £2m a year consultancies from skint people stealing from shops.

Blair: What on earth would he know that could justify a salary of that size?! He was a barrister and then a PM without any other mnisterial position in govt, ever! Wouldn't it be interesting to just see the output for this fee, just for one year?

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I don't think it is , the banks do not need trust when they have a captive clientel that included's most of the adults in the nation . Try running your life without a bank account almost immpossible now , even those who have gone bankrupt have access to a basic bank account and that is one of the first things they get in place when first made bankrupt . Wages , benefits , pensions , refunds are all paid straight into bank accounts and some companies offer disscounts for payment's when coming from bank accounts via DD.

I'm one of the people whose mind is the camp of pro-free markets and capitalism generally, but that services and industries where:

a ) competition is just hyperbole and the industry is essentially a monopoly (Water, Gas, Electricity etc.)

and b ) the service / product is completely essential to modern society (a human right perhaps?)

they should be run nationally for everyones' benefit.

With that in mind, and your assertion above, I'm looking at those two clauses above and thinking that banking falls into that category as well.

Should day-to-day banking services for the general populace be a nationalised industry?

Investment banking can remain private for those who wish to partake in it.

Thoughts?

Edited by ska_mna

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I don't think it is , the banks do not need trust when they have a captive clientel that included's most of the adults in the nation . Try running your life without a bank account almost immpossible now , even those who have gone bankrupt have access to a basic bank account and that is one of the first things they get in place when first made bankrupt . Wages , benefits , pensions , refunds are all paid straight into bank accounts and some companies offer disscounts for payment's when coming from bank accounts via DD.

Talk to old people and they will tell you misstrust of the banks has always been the case , we have had the NR crisis , Mortgage Express, H.B.O.S., Lemans and a few smaller ones like Derybeshire Building Society all collapse in the last few years , that is without the billions pumped into others and still the customers stay with the banks WHY ? Because they have no choice.

I think for the little guy you are right- but it looks like the bigger fish are getting worried: :o

In a shocking representation of just how bad things are in Europe, the FT reports that major European industrial concern Siemens, pulled €500 million form a large French bank, which is not BNP and leaves just [socGen|Credit Agricole] and deposited the money straight to the ECB. The implications of this are beyond stunning, as it means that even European companies now refuse to work directly with their own banks,

http://www.housepricecrash.co.uk/forum/index.php?showtopic=169496

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Politicians are very unlikely to get £2m a year consultancies from skint people stealing from shops.

this +100

take their power away and they can't spend your money so much.

but nooooo, government is good everyone keeps saying.

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  • 337 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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